Stocks Radar: Axis Bank, Hindustan Petroleum, Indraprastha Gas, TCS
Indian equity benchmarks opened higher, led by gains in oil retailers and Tata Motors Ltd. Asian stocks, too, extended gains and are headed for the biggest weekly rally since April 2016, amid fresh hopes for trade talks and China stimulus. The S&P BSE Sensex and the NSE Nifty 50 Index traded more than 1.5 percent higher at 34,960.09 and 10,547.75, respectively, as of 11:05 a.m.
The market breadth was tilted in favour of buyers. Ten of the 11 sectoral gauges advanced, led by a 3.52 percent gain in the Nifty Auto Index. The NSE Nifty Pharma Index was the only loser, down 0.09 percent.
Here Are The Stocks Moving The Market This Morning
Hindustan Petroleum Gains After Global Crude Prices Ease
Shares of the oil marketing company rose nearly 4.1 percent to Rs 239 apiece. The Brent crude prices fell 0.6 percent, declining for the fifth straight session, to $72.46 a barrel.
Higher crude prices during the July-September period impacted Hindustan Petroleum’s earnings which fell for the third straight quarter. Net profit declined 36.5 percent sequentially to Rs 1,092 crore in the July-September period as gross refining margin dipped to its lowest in nearly two years, according to its exchange filing.
Other Highlights (Q2, Quarter-On-Quarter):
- Revenue fell 0.2 percent to Rs 67,518 crore.
- Ebitda declined 33.5 percent to Rs 2,122 crore.
- Ebitda margin stood at 3.1 percent against 4.7 percent.
Here’s what the brokerages have to say about the company:
Deutsche Bank Research
- Maintains ‘Hold’ and hikes target price to Rs 240 from Rs 230, a potential upside of 5 percent from the last regular trade.
- Second-quarter net profit and Ebitda below estimates.
- Headwind ahead in the marketing business.
- Downgrades to ‘Accumulate’ from ‘Buy’; maintains target price at Rs 248—a potential upside of 8 percent from the last regular trade.
- Second-quarter results below expectations, led by lower sales volume, weaker gross refining margin and higher foreign exchange losses.
- Lower crude price and regular price hike to improve marketing margins.
- Expects crude oil price to soften, but the election year will continue to act as an overhang.
State-run Indian Oil Corporation Ltd. and Bharat Petroleum Corporation Ltd. also gained on softer crude prices.
Other Stocks Reacting To Earnings
GlaxoSmithKline Consumer Healthcare (Q2, YoY)
- Stock rose as much as 4.3 percent to Rs 7,350 a share.
- Revenue up 14.4 percent to Rs 1,272 crore.
- Net profit up 43.2 percent to Rs 275.5 crore.
- Ebitda up 36.6 percent to Rs 353.7 crore.
- Margin stood at 27.8 percent against 23.3 percent.
Tata Communications (Q2, YoY)
- Stock fell 4.5 percent to Rs 476.40 apiece.
- Revenue down 4.2 percent at Rs 4,068.2 crore.
- Net profit at Rs 1.7 crore versus net loss at Rs 248.4 crore.
- Ebitda up 6 percent at Rs 630.2 crore.
- Margin at 15.5 percent versus 14 percent.
Aarti Industries (Q2, YoY)
- Stock rose 7.2 percent to Rs 1,421 apiece.
- Revenue up 46.4 percent at Rs 1,299.5 crore.
- Net profit up 56.6 percent at Rs 122.9 crore.
- Ebitda up 51 percent at Rs 242.1 crore.
- Margin at 18.6 percent versus 18.1 percent.
(prices as of 9:18 a.m.)
Indraprastha Gas Gains For Fifth Straight Session
Shares of Indraprastha Gas rose as much as 6.4 percent, extending gains for the fifth straight session, to Rs 297.05 apiece.
Indraprastha Gas agreed to take over the supply of natural gas in Gurugram district from Haryana City Gas Distribution Ltd., resolving a long-pending dispute amicably. Both the companies have also agreed to the Additional Solicitor General’s suggestion to appoint Deloitte Haskins and Sells LLP as an independent valuer of the business, according to a Supreme Court order uploaded on the stock exchanges by Indraprastha Gas. Deloitte Haskins have to submit the report within four weeks.
The stock gained 13.5 percent this week, its best performance since Jan. 11, 2016. The trading volume is 13.3 times the 20-day average, Bloomberg data showed.
TCS Swings After Digital Acquisition
Shares of India’s largest software services exporter fluctuated between gains and losses to trade at Rs 1,947.25 apiece.
The company acquired London’s digital design studio W12 Studios for an undisclosed sum, according to its exchange filing. This deal will strengthen digital and creative design capabilities and will be part of TCS’ interactive division, it said.
The stock gained 50 percent so far this year compared to a 5 percent advance in the BSE Sensex, according to data compiled by Bloomberg.
Axis Bank Gains Ahead Of Earnings
Shares of the private lender rose 2.1 percent to Rs 616.40 apiece. The bank is scheduled to announce its September quarter earnings today.
Preview (Q2, Year-On-Year)
- Net interest income expected to rise 13.4 percent to Rs 5,147 crore.
- Net profit likely to increase 75 percent to Rs 759 crore.
The stock trades at 30 times its estimated earnings per share for the coming year, Bloomberg data showed.
Other Stockings Buzzing Ahead Of Earnings
Indian Oil Preview (Standalone; QoQ)
- Stock rose 4.5 percent to Rs 148.15 apiece.
- Revenue expected to rise 5.5 percent to Rs 1,36,593 crore.
- Ebitda likely to go down 24.5 percent to Rs 9,495 crore.
- Ebitda margin seen to contract 270 basis points to 7 percent.
- Net profit seen to fall 25 percent to Rs 5,120 crore.
- Gross refining margin expected to fall $6.2 a barrel against $10.2 a barrel.
Hindalco Preview (Standalone,YoY)
- Stock rose 2.4 percent to Rs 236.85 apiece.
- Revenue expected to rise 4 percent to Rs 10,686 crore.
- Editda seen to decline 10.3 percent to Rs 1,246.3 crore.
- Ebitda margin expected to contract 180 basis points to 11.7 percent.
- Net profit expected to go up 21 percent to Rs 476 crore.